As a shared services veteran who has led three different shared services organizations, including one major outsourcing, I have learned a few things during the years. Here are what I consider the most important factors for a successful outsourcing.

Out of Sight, Not Out of Mind: Outsourcing does not eliminate your responsibility. It is easy trap to fall into, when people are thousands of miles away, to think that you do not have to “worry” about certain work since someone else is doing it. However, if you are the Global Purchase to Pay leader, then you own the output of the processes regardless of where they are done or who does them. When coaching my team, I said, “Instead of your team being 100% employees, located in the same building with you; your team now is a mixture of employees and the staff of an outsourcing vendor.

Your process metrics remain the same and I am holding you accountable for all outcomes. You need to be in daily contact with the staff of the outsourcing vendor.”

Do Not Go Live until You Are Ready: Once a decision is made, it feels like management believes it will magically implement itself. In reality, once the contract is signed, the hardest work of all begins; implementation. It is absolutely critical to use a formal phases and gates process. Never pass any gate without being ready. The only outcome if you do is a bad one. The process I used had 6 gates: Corporate Sponsorship, Definition of the As-Is State, Finalization of the Statement of Work, Definition of the To-Be State and Knowledge Capture, Training and Delivery Readiness [required to Go-Live] and Stabilization. Each Gate had very detailed requirements and if I was not satisfied, the Gate was not passed.

As a Leader, Roll Up Your Sleeves: Outsourcing is a very complex process. As the overall leader of financial shared services, I was responsible for the success or failure of the outsourcing. I spent time reading many of the work instructions (the detailed instructions for how the work is to be done) to ensure myself that the quality was what I expected. What I was doing was a visual quality inspection. It was not due to lack of trust, since I was surrounding by highly talented staff. Rather, the more spectacular a failure can be, the more a leader needs to kick the tires on everything.

If you’re outsourcing multiple functions at the same time, you need someone internally, who is very skilled at project management to watch out for your interests as well as the outsourcer’s, to coordinate all your outsourcing efforts, and to proactively alert you to issues an outsourcer might hide.

Assign a Full-Time Internal Transition Leader: Our outsourcing to IBM covered 80% of the finance shared services organization. It included roughly 18 work-streams such as US accounts payable, Europe accounts payable, US general ledger and Europe general ledger. Each work stream followed the phases and gates process. Again, it is easy to think that the outsource provider will have a transition leader so why would I need an internal one?

The exact opposite is true. If you’re outsourcing multiple functions at the same time, you need someone internally, who is very skilled at project management to watch out for your interests as well as the outsourcer’s, to coordinate all your outsourcing efforts, and to proactively alert you to issues an outsourcer might hide. Our transition leader was likeable, cheerful and held everyone’s feet to the fire. Without her we would not have been able to meet our timelines.

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Make the Outsource Team Feel Part of Your Team: Although the global service delivery managers visited the outsource center frequently, I also made it a point to visit at least twice a year. Teams do not do their best work if they are in a vacuum. Just as local teams need to understand the bigger picture so do the employees of the outsource provider. This also helps to build a culture of mutual respect.

Communicate, Communicate, Communicate: You must share plans and progress frequently with your internal stakeholders. For example, credit and collections has two key internal stakeholders; business units and treasury. Each one will have concerns about the process and how it will impact customers and cash. By getting their input into the outsourcing plans and progress you will gain useful insight that can be incorporated into your detailed plans. I included key stakeholders in the phases and gates process. In addition, employees were kept up-to-date on a weekly if not daily basis, once the decision to outsource was made. Almost every employee had a part to play in the outsourcing.

In summary, the outsourcing was a beneficial next step in our shared services journey. Talented people on supplier side working in tandem with company employees resulted in a successful transition. It was not without some bumps along the way, but attention to detail and quality made it work.

Other items to consider:

• Focus on governance [or advisory boards], be sure the outsourcing executive is strong and ask for a change if you need it